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Judge Blocks U.S. Ban On WeChat

Topline

The Trump administration’s restriction on downloads of popular Chinese-owned “super-app” WeChat has been put on hold by a federal court in San Francisco, days after the Commerce Department had ordered the removal of the app from smartphone app stores starting Sunday, calling it a threat to national security.

Key Facts

Magistrate Judge Laurel Beeler issued a preliminary injunction at the request of the U.S. WeChat Users Alliance, which had argued that the ban on the app would violate the free-speech rights of millions of Chinese-speaking Americans who rely on WeChat to communicate with relatives in the U.S. and China, Bloomberg reported first.

At the hearing on Saturday, Michael Drezner, a lawyer defending the government’s order, argued that the anxiety faced by U.S. WeChat users doesn’t entitle them to an injunction, adding that their reliance on WeChat was a result of China’s restriction on other social media apps.

In their filing the WeChat users had argued that they were reliant on the “super-app” to make phone calls, hold video conferences, upload documents, share photos and make payments, making the app “essential to the conduct of daily life for its users.”

On Friday, the Commerce Department had announced a ban on downloads for both WeChat and Chinese-owned video sharing platform TikTok over national security concerns.

The ban on TikTok, however, has been pushed back by a week after the company announced a plan to sell 20% of its stake to Oracle and Walmart.

Key Background

President Donald Trump had signed an executive order on August 6, which had called for a ban on all transactions between WeChat’s parent Tencent and all U.S. entities after 45 days. The ambit of this ban was unclear, and various U.S. companies operating in China including Apple, Disney, Ford, Walmart and others had raised concerns that such a move could undermine their competitiveness. The app’s U.S. users had also expressed concerns about the fallout of the ban. However, the Justice Department, in a court filing, had said that WeChat users who solely use the app to communicate personal and business information won’t be targeted by the ban. The Tencent-owned WeChat app has more than 1.2 billion uses globally and functions as a “super app” in China, used by consumers, businesses, celebrities and the government. The app is used for text messaging, payments, e-commerce, social media and news.

Tangent

Following the crackdown on WeChat, the Trump administration reportedly sent out letters to U.S. online gaming companies like Fortnite-maker Epic Games, Riot Games and others requesting information about their relationship with the multibillion-dollar Chinese technology company, Tencent, Bloomberg reported on Thursday. Citing sources, the report added, that the Treasury Department chaired Committee on Foreign Investment in the U.S., is looking for information about how these companies handle the personal data of their U.S. customers. Tencent is the world’s largest gaming company, and it owns a 40% stake in Epic Games, and it fully owns Los Angeles-based Riot Games, the maker of League of Legends.

Further Reading

Trump’s WeChat Curbs Halted by Judge on Free Speech Concerns (Bloomberg)

Oracle And Walmart To Acquire 20% Stake In TikTok, Trump Gives His ‘Blessing’ (Forbes)

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